A new initiative to develop an orderly shift to a low carbon economy – backed by energy giants including Shell and BHP Billiton – was officially launched today.
The Energy Transitions Commission (ETC) – introduced in Austin, Texas at Fortune’s conference on energy, technology and sustainability – brings together some of the world’s most influential individuals in the energy sector who have joined forces to advise on how to deliver economic development and tackle climate change.
Commission members include former and current national leaders, CEOs of major companies and distinguished thinkers on energy issues.
Shell chairman Chad Holliday, former US Treasury Secretary Hank Paulson and RWE Chief Executive Peter Terium are among those acting in a personal capacity to advise governments on how to change their energy markets without damaging the environment.
The initiative follows closely in the footsteps of a call made by oil and gas companies, including Shell and Statoil as well as BP, Total, BG Group and ENI, for the introduction of a carbon pricing system.
It’s official launch also comes on the same day that Shell announced it was pulling out of its controversial Arctic drilling programme after failing to find sufficient signs of oil and gas to make further exploration worthwhile
In its launch paper the Energy Transitions Commission said: “It is inherently difficult to change from proven development paths to something more fundamentally uncertain, but change we must.”
A positioning paper published by the ETC explores the need for the global energy system to change over the next decades and how that evolution is made up of many distinct, but inter-connected energy transitions.
Commissioner Lord Nicholas Stern, former chief economist of the World Bank, said: “Over the next 20 years the world will continue a very rapid and deep structural transformation with intense urbanisation and strong increasing demand for energy at its core, particularly in emerging markets and developing countries.
“Simultaneously the cities of rich countries and their energy systems are in urgent need of renewal and advancement. How we manage this transition is therefore of fundamental importance.”
Lord Stern is author of the Stern Review on the economics of climate change.
The ETC seeks to provide an independent ‘systems approach’ to the challenges faced by those who are tasked with making this happen.
Holliday, Jean-Pascal Tricoire, CEO of Schneider Electric and Jules Kortenhorst, CEO of the Rocky Mountain Institute, introduced the ETC at the Fortune Brainstorm E Conference in Austin, attended by leading business figures and influencers.
Green commentators have questioned whether the ETC will be able to demonstrate its impartiality and apparent conflict of interest of its key backers such as Shell and other oil and gas companies.
Commentator Gerrard Wynn, said: “Naturally, some doubters might wonder if this is Shell’s attempt to get back on the front step, after long-running environmental campaigns against its Arctic drilling, in the run-up to the biggest summit on climate change for years, in Paris at the end of this year.”
Reacting to Shell’s Arctic decision, Greenpeace UK executive director John Sauven, said: “Big oil has sustained an unmitigated defeat…”
“The Save the Arctic movement has exacted a huge reputational price from Shell for its Arctic drilling programme. And as the company went another year without striking oil, that price finally became too high. They’re pulling out.”
Sauven said President Obama should use his remaining months in office to say that no other oil company will be licenced to drill in the American Arctic.
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